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The EU Breakup

Wikistrat - The EU Breakup cover

Should Britain vote to leave the European Union in its referendum this month, the bloc’s disintegration would undoubtedly be accelerated. But even if the United Kingdom votes to stay in, there are forces at work that could conceivably break up the EU.

The two most serious forces are economic stagnation and the dramatic increase of non-European citizens seeking entry into the countries of the EU. Both are undermining the willingness of member states to pursue pan-European solutions and both contribute to the success of political parties that advocate a weakening or a breakup of the Union.

Wikistrat recently conducted a crowdsourced analysis of what would happen if the EU does fall apart. Our analysts rate the probability of such a breakup as still fairly low, but if it does happen – perhaps only partially – it would not slow the forces driving disintegration. Instead, many of the drivers of disintegration would remain – and in some cases would be exacerbated.

For instance, a British exit following the referendum or a French exit following the election of Marine Le Pen as president would economically isolate both countries. Smaller nations would suffer even more if they left the EU. A comprehensive fracture with a number of national withdrawals would likely result in high inflation in southern and peripheral member states, or cause debt defaults with subsequent severe budgetary restraint. Read More →

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